A novel Algal-Sludge Bacterial-Membrane bioreactor (ASB-MBR) system, which combined a sludge membrane bioreactor and an algal system in a single tank, was developed in this study. The combined system exhibited excellent wastewater treatment performance, sludge flocs properties and membrane permeability. Compared with conventional MBR (C-MBR), ASB-MBR showed 25% faster growth rate. Meantime, the removal efficiencies of chemical oxygen demand (COD), ammonia nitrogen (NH4+-N), total nitrogen (TN) and phosphate (PO43--P) in ASB-MBR were increased by 4.6%, 6.7%, 10.1% and 8.2%, respectively. Amelioration of microbial activity and the increase of dissolved oxygen (DO) concentration were identified as the main reasons for better COD and nitrogen removal, while algal great assimilation and "luxury" uptake of phosphorus and high mixed liquor suspended solids (MLSS) removal contributed to higher PO43--P removal in ASB-MBR. Moreover, the membrane fouling was mitigated by 50% after inoculating algae. Further mechanism investigation demonstrated that algae has a positive influence on the inhibition of the filamentous bacteria overgrowth and the decrease of zeta potential absolute value, thus improved the flocs flocculability and stability in ASB-MBR. ASB-MBR exhibited higher SMPpr/SMPps ratio, lower bound extracellular polymeric substances (bound EPS) concentrations and smaller Pr/Ps ratio in bound EPS, which contributed to improve the flocs filterability and decrease the fouling layer accumulation. Deposited by this modified sludge, the flocs morphology of the bio-cake in ASB-MBR was more regular and less easy to accumulate on membrane surface resulted in higher membrane permeability.